Last year when we filed our taxes, we received a pretty big state refund but had to pay an even bigger federal tax bill. The difference was a little under $1900 that we had to pay to the federal government. So, after we filed last year, we adjusted The Husband’s taxes so that we (hopefully) would not be in the same boat this year.
And it worked… sort of. We are still getting a refund from the state (just smaller) and we still owe the federal government (just less).
After the adjustments to our taxes, we started bringing home around $100 less per month, which kind of sucked (to be honest), but it was better than having to come up with all the money at once. We are very lucky to have some money in savings and not be living totally paycheck to paycheck, but it still hurt to have to dig into our savings.
I can’t remember all the exact numbers this year, but I know that the difference is a little over $1100 that we owe in taxes to the federal government. That’s a decrease of over $700 so I will take it. We have thought about adjusting our taxes even further but because of some possible “life” things coming up, we have decided to leave them as they are for now and we will pay whatever we have to pay next year. (Not because we need the money, but more because we don’t know what the future is going to look like and we feel like paying $1100 isn’t too bad.)
We were hoping we would owe the federal government very little so I’m bummed that we have to take the money out of savings to pay them, but still glad that it’s there. Taking $1100 out of savings puts a wrench in my goals, but we have to pay our taxes so it is what it is.
I’m glad to have our taxes done and filed. We have already mailed the check so we are done with taxes for another year.
April 2nd, 2024 at 08:28 pm 1712089727
You need to know
- your gross income
From that, subtract
- your pre tax deductions like HSA/FSA, traditional 401k/IRA, health insurance premiums, 529 deposit
- standard deduction for your filing status (if you itemize you might have a higher deduction but for projection, you can use standard)
- how many children are eligible for exemption multiplied by exemption amount
That is your taxable income
Then use the tax table for your filing status to calculate ate what you will owe.
Then look at what you are paying from each paycheck, and multiply by the number of paychecks you will receive in a year.
In a perfect world, those 2 numbers are equal.
I think it is fine to owe some money each year - just save a little yourself each pay period.
You can Google to find tax bracket info.